today's show, but when we're done here, i'll be heading over to facebook to answer questions. go to facebook, like us and ask your question. >> talk of the day, sirius, the company announcing a $2 billion share buy back. and it's a $2 stock, but everybody knows it. mel's gone, howard's still there. >> all right, that does it for us today, again join me on facebook after the show for office hours. right now it's time for "squawk on the street." good thursday morning, welcome to "squawk on the street," i'm melissa lee live from the new york stock exchange. negative across the board, looks like we're going to lose about 8.5% on the dow. we're watching for headlines out

of an ecd press report. our road map this morning starting with apple, cratering on its biggest decline yesterday on four years, closing just pennies off the lows of the session. the stock continues lower premarket as investors watch the death cross watch. >> a cnbc exclusive, tim geithner says over the cliff is a must. >> bank of england and ecb keeps rates unchanged. europe continues to hang in there economically. >> and nat gas gets a boost. the government finds exporting it is better than keeping it here at home. >> apple as we mentioned in the spotlight today, shares of the tech giant coming off their worst day in four years, sliding back into bear market territory. the one day loss erased nearly

$35 billion in market cap. that chunk is bigger than 400 other s&p 500 companies. apple ceo tim cook talked to nbc's brian williams in our rock center exclusive. >> why can't you be a made in america company? >> you know, this i found, as a matter of fact, the engine in here is made in america. and not only are the engines in here made in america, but engines are made in america and are exported. the glass on this phone is made in kentucky. so we have been working for years on doing more and more in the united states, next year, we will do one of our existing mac lines in the united states. >> you can see the entire interview with tim cook tonight on rock center, that's 10:00 eastern time on your local nbc station, but for now investors are watching the market. apple shares 5.31, which is close to the main lows.

this is close to the next s support level on the stock and really catching a lot of people by surprise. >> it's a fiscal cliff decline. this is the greatest capital gains generator of our lifetime. i would love to see what the gains are going to be next year. but i would be saying you need to sell it. we have no idea where the capital gains are going to go, we're going to go over the fiscal cliff, what do you have to lose, the rates are going to go up. i don't think it makes any difference two tim geithner says. >> it is so widely held by so many who want to play the stock market, let's say, beyond just the capital gains, whether it's in taxable account organization not and it also has the psychological impact that this is the one that i'm going to get out of because i'm afraid of

what's coming in general? >> this is the stock, yes, it's cheap, now once it goes down, we have a million reasons, well, it's a nokia phone, well, it's china. ipad miniis available. this is a stock that's so widely owned. it reminds me of sirius satellite. every doctor, every dentist owns apple. they don't know the price per share, they just know it is the proxy for the market. >> they just accelerated dividends. but i think we're talking now 150 companies in some fashion have accelerated or put forward a special dividend. you put forward a special market share, china is 76, with the market share at least. >> is it a disappointment that apple did not pay a special dividend? is that part of this?

>> there was some of that. >> there was some expectation? not that they ever gave any voice to it. they never said a word about it. >> true. >> look, it is widely owned if the stock were -- it's obviously, here's the stock that went from 70 to 50, maybe it goes to 48, 45. everybody who doesn't know what apple is, other than the fact that they use an imac or iphone are selling it. and, look, if you're a hedge fund manager you went from thinking i have to own it, or i have to short it. . >> in addition to talk to brian williams, tim cook gave an interview to bloomberg business week, a very long q & a in which they reference brave earned capital. it's an entity that manages

apple's cash, but cook says it does have some of the safest investments known to man. talk about the black box. >> biggest net cash position is indeed burning a hole in people's pockets. do they need to buy twistetter? right now the people who own apple are without a doubt the worst shareholders i have ever seen en masse. they want to take their gains, they're not sure what they v at rockefeller center last night, around the christmas tree, someone comes up, i'm thinking they want a picture, no, what do i do with my apple? i always say, look, i think you should own apple. but i know you're only asking the question because you want to sell apple.

i ask them if you know the multiple, they say all i want you to do is bless the sale. i'm just out there shopping. i go to j. crew today. >> i'm at that building often times, i walk by that store. >> i got 30% off a coat. you got to get in there, i got 30% off a coat i was willing to pay full price for. people are truly perplexed about what the stock is, where it got to, what do you do with it? >> you can come up with a million reasons here, it's manufacturing, maybe it is manufacturing, but is there really a demand question about apple's products that is a real one? >> not in the u.s., but there could be some questions about china, remember that report from steve milanovich? he said apple needs to come up within some real innovations,

you need to have some clarity on the pipeline, and you need geographic -- clearance to go into china? yes, it got it with two of the smaller carriers. china confirms talks with apple. but the problem here, he says tech is not an issue, it's mainly about the business model and benefit sharing issues. that could be a problem. >> he is also playing the part of what many analysts are doing, which is let me explain why it's going down, in the same way that the death cross, i always love the death cross, this is a technical term. i can think of a million reasons to sell it. the only reason i want to own it is because it makes the best products in the world and it's inexpensive. >> that's a lot of people looking at the chart. >> look again, the people who own apple, they were the ones who owned it because it was going up. it reminds me very much in 1999,

what do i do with my nortel, it's at 110. in the meantime, roth, the ceo gives a session, an off the record session, or a session where he bashed 15 people. and said you know what? we're going to miss the numbers really big. apple is not nortel, but it trades like those that do and people get into the rut of saying i got to sell, everybody else is selling. this has happened before but just not with a company we respect like apple. tim cook, i'm going to find tim cook and say, listen, man, death cross, doesn't that trump itv? maybe you sell -- maybe you replace dell and hewlett packard, and i say chief, because you got the chief the guy, what about the death cross? david, the death cross versus -- come on, partner. >> it says sarcasm at the bottom

of the screen. >> tim cook, you can tell at the board meeting, you know that he usually presented charts on the product. he's got the stock chart and he shows you where the death cross, he's probably into macd. the trend? i can tell you right now, he's getting deep into the world of mark number, he's doing some of the finest technical work. it's no longer technical work about the it thing. it's the chart. and until you embrace that, you're going to miss what tim cook's got, the omg chart. >> the stalemate continues over the fiscal cliff. today the president h showcasing -- steve liesman asked the treasury sec temporary about the possibility of going over the cliff. >> i want to understand the

administration's position when it comes to raising taxing on the wealthy, those making more than $250,000. if republicans do not agree to that, is the administration prepared to go over the fiscal cliff? >> absolutely. there's no pros teblpect to the agreement that doesn't involve taxes going up on the wealthiest 2%. remember it's only 2%. >> i talk every day to our customers around this country, around the world sometimes for that matter too, but around the country, and they are all scared to death what happens in january, nobody knows, but all i know is going over the cliff is too hot to handle, it's an option we just can't stare in the face and there's no way we can do it. they will get us through this in one form or fashion. >> interesting call. conventional wisdom, obviously the white house and the

secretary hardening their line, and a lot of people are saying the republicans are starting to fray, to concede that rates will go higher, maybe not to 39.6% there's discussion in politico that there's a 37% solution. the republicans can say we defended against the worst case, but we gave the president og something. >> obviously right the norquist side, which is the i'm going to get you to lose in the primary if you vote for the increase and the geithner side, in an interview with, a dow killing interview, other than apple. he didn't reference the apple chart, but this was one of those interviews where tim geithner was saying, we're done. we're going on vacation, no legislation, and it was really nice to meet you republicans, and the rates are going haiig h and it was basically devastating, saying, hey guys. >> cliff me, cliff me. >> but geithner didn't stick by

the highest increase, so maybe that's the common ground so maybe that way we can find the higher ground on this. and maybe that's the way to some sort of consensus on the tax issue. >> they all a are talking to senator casey, not a lot of time that i can see. i want to know how many of them have tickets in hand and what's the date of their ticket and whether they're using delta or getting out with yuunited airlines. i agree, that their door should be open. but if you're geithner, you're calling all these people who have impure thoughts. he's saying your seat's not safe, i have got a guy that run against you. >> he's got a republican that will run against another republicans for some senate seat? >> it's a pledge. >> i just want to make sure that we still think there's a viable opposition for whomever is on

the republican seat. >> read my lips, i'm going to lose if i raise taxes. >> it's happened before. >> i also remember ross perot got 22% of the vote that time. >> you're saying that the threat to pull the plug on any representative who took the pledge is far greater than any desire to rise above. >> they like being members of congress. there's no doubt about that. >> they do, don't they. >> yes, they do. >> don't mention pumps. . >> when we come back this morning, a new report finds that exporting nat gas will actually help the u.s. economy, but not every day is a winner. vice chairman alan blinder will tell us what he thinks.

a new study from the federal government shows exporting u.s. natural gas overseas has the potential to reshape the global energy markets. the obama administration has said the study will be central to the decision on whether to export. he said exporting the gas would

be a bigger impact on the economy. >> slap in the face of dow chemical. of coke, not coke the beverage company. but this was something that was hotly disputed within the romney campaign. he really let this stuff go because the romney campaign had some very big givers that were chemical companies. >> do we know, say, very bad, how much will prices conceivableably go up if we become an exporter of natural gas? is it that great a difference? >> we burn offer more natural gas than we use. burn off, in other words literally, you see those flames, we flare more than we use. so we got a real excess of this stuff. >> the government says that the -- 6.6% of current u.s. consumption. >> why would prices move that dramatically at all?

wouldn't they just come down globally? >> the average, our $16 goes to $4. it costs $7 to get stuff from the united states. >> you should argue that they should go down because they went be the only one. dominion has brooif cove, that's the one that's most ready to go. the gorgon numbers, this is the gigantic l & e experts. it's not going to cost $60 billion. these plants cost a fortune, they put a lot of people to work. i think that this is the opening savlo, i want to know what the shadow government has to say. >> the increase in the environmental lobby is not going to be happy. >> no, it's a huge full disclosure. >> there are some environmental

groups that support fracing as the best alternative, if we have got to go with something. we have got to produce energy in this country. there's one in particular. >> sierra was pro nat gas, the lesser of all evils. the chesapeake was giving a lot of money to sierra. this is very controversial so it's not over. >> a lot of companies have switched over to natural gas so will consumers see their gas go higher? and could this be good for the coal industry? >> this is years over. >> 2016 will be the first. and who knows if they can really finish. these are very complex plans as i mentioned. chevron's been trying to do it for years. >> now that you've heard what cramer has to say about natural gas, will the stocks he mentioned in his mad dash add

fuel to your portfolio? and lululemon having their conference call right now. looking at the down day, s&p is looking to lose about 2% on the open. much more "squawk on the street" straight ahead. twins. i didn't see them coming. i have obligations. cute obligations, but obligations. i need to rethink the core of my portfolio. what i really need is sleep. introducing the ishares core, building blocks for the heart of your portfolio. find out why 9 out of 10 large professional investors choose ishares for their etfs. ishares by blackrock. call 1-800-ishares for a prospectus which includes investment objectives, risks, charges and expenses. read and consider it carefully before investing. risk includes possible loss of principal. can i still ship a gift in time for christmas? yeah, sure you can. great. where's your gift? uh... whew. [ male announcer ] break from the holiday stress.

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today, my stock is in a hopeless place. this stock is in 66, when it comes out in the headlines, negative. the 10:15 interview will be the most important interview than anyone has on squawk other than. your interview is going to determine the next ten points on lulu. >> everything always thinks that accumai. when you get netflix, very controversial stock, but don't by this on a takeover basis. buy it because it's a very well run company that people use to get the fastest video to your house. >> there is a still a ringing of the debate in the journal today

about whether or not this deal with disney. >> david favor has pointed out that it's international that's causing the problem with netflix. if they shut down europe the way that citigroup is shutting down the world. netflix goes to 100. >> managing down as you said before. >> managing down. when we come back, the former fed vice chairman takes aim at both republicans and democrats. we'll talk to alan blinder. apple is down in fair territory at 5.28.

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and this number should be essentially clean of sandy effects, so finally a clean read as to the claims aspect. but it doesn't look like, jim, that we are set for a lower open today. >> carl pointed out that maybe there's some room between sides. but, look, yesterday was one of those days, show a lot of americans don't even know about the fiscal cliff. paychecks are going to go down, a million layoffs in the defense industry. no one seems to care right now. it's bad. >> you know what we have going for us? the grid, december 17 announced -- on a seasonal basis, they have reiterated once again that it doesn't have the demand to be sold year round, but starting a week from monday. >> i don't buy that. i think they do it because whenever they have mcrib, they're just fighting traffic for mcrib. there are places in the world where the mcrib is on the menu

all the time. in case you're there on your vacation. >> i'm learning here all the time. i'm always learning. >> switch from the bacon cheese-inator. [ bell rings ] . >> celebrating the ground breaking of hotels in new york. we'll be speaking to the ceo in this hour. >> whitehorse is an interesting story. >> white house, delayed over at the nasdaq, the new york stock exchange puts out a release reiterating 16 companies have

announced or moved to the big board so for this year. you're starting to wonder who would go public on the nasdaq. >> still waiting for the night capital resolution, knight had taken a real shot and nasdaq offered the facebook ipo. so there's bad blood everywhere behind the scenes. these guys don't like each other, it's like the skewers, ravens, anybody versus the patriots. >> anybody verse bill belichick, yeah. >> the dow holding on at one-month highs, we did see the impact of apple on the s&p 500 and the nasdaq on yesterday's section. apple this morning opens lower by 2.5%. right now, on apple, we are at $5.26 and change. the main lows at the 5.20 dlerz. these are all levels that we're watching very closely.

and we don't need to bring this up because we love talking about apple. we're talking about apple because so many people own it and it has a huge impact on the overall market. >> nasdaq went down yesterday. it's funny, you pick up the paper today, in the "new york times," the new imac is down. >> you take a look at any great consumer products company and it had some sort of a cult following. nike. >> it's the curse of the $600 million market cap. >> it's really big, they got to get to where the people who own it actually like it, are not worried, are not options holders. reminds me of silver at a much higher price one day. >> i think the company is trying to corner the market.

>> wow, that was some move. but the we cans have to go and the people who are looking at the fiscal cliff and getting that tax bill and people are saying i do own this in my "mad money" account, i can understand why they would want to sell it. >> revenues light as well. they are claiming not only the election, not only the cliff, but broad economic concern, traffic levels coming down on this. >> this is a very well run company that has missed and made and beaten, you can see the chart, missed, made, missed, made. this is not for strond. nordstrom. >> this week on twitter, they realize people are done playing with fake money they want to go to real money. >> they're looking for a gaming license. and i'm going to ask all of you, will this be the conversation,

senator, if you would like, my final offer is this, this is zynga talking to garry. will that be a discussion between pinkas and the senator from nevada? >> you're hoping. >> that's the godfather ii, verbatim. that's what they need. zynga needs that gaming license. he needs a fee to be paid by the senator personally in order to make the quarter. david fiction, reality? >> your hope is that, exactly. >> senator geary. >> reality mirrors fiction. >> i think fiction is much better than reality because it's rational. is there a plaque, is there nick from mow green out there. >> there's a signal. >> still there's nothing. it's just a way to gis to go to l.a. >> take a look at starbucks, higher by 2% today.

a lot of analysts are coming out after having gone to that investor day yesterday. baird says it has renewed confidence in the earnings momentum and bernstein says it sees more growth in the u.s. with high profile purchases to add to revenue channels. >> i went there yesterday and listened to it. one of the things that i really thought was interesting was that they were talking the china guy speaks, u.s. speaks, we can open thousands and the questions were horrendous from the analysts, they were all like these nitpicking questions, had i been howard schultz, i would have voteded the chairman of the board. there's an awful lot of coffee in brazil. why don't you get there. these analysts hated the stock yesterday. >> if you went to that conference or you listened to the conference and the analysts

are all positive and asking positive questions. how much can you grow in china. you were taken to task as well. >> if the stock were 10 points higher, i would say sell it, but this stock is down very badly. the price point is historically low. i listened to these analysts, they're basically focused on whether the last three weeks in china showed any decline for the triple cappuccino with skin wet. and i come back and i say, well, the growth path year is much more than we thought. the growth can be accelerating. today the three guys come out very, very positive. and i thought the thing was positive. i was shaking my head yesterday and i said wow, how much coffee do these guys need before they start asking questions. >> i know we did want to point out shares of freeport, down again. another 4% decline for fcx this morning. that also taking down as you might expect, pxp and mmr.

mmr is a cash deal. investors just weren't warm to it yesterday and won't warm up today. of course the other deal's all cash. but people still wondering about the strategic rational behind the scene. >> i don't even want to say behind the scenes. >> there are a lot of poor relationships here, jim bob moffett t chairman of both companies, mmr, owns a stake in pxp, board seats. it's related. >> and yet, ackerson, did we get hold of him? he's always been very pro shareholder. this is the most anti-shareholder. unless you're a very large shareholder. >> isn't he cynical? >> these guys are different, moffett and our man in chesapeake.

>> thank you. they approach the world a little different. >> is it different from you? you're fitzgerald. >> i don't want to say cavalier, but they like to take risks, that's how they built their fortune in the first police, they all take risks. >> i thought if you bought freeport, you were trying to play the grassberg, big copper, the china thing, i didn't know i was getting involved in a high stakes poker match. >> yes. which is why you're selling. >> let's get to bob pisani who's on the floor watch what's moving. >> moffett wants the cash flow from freeport who helped finance the drilling for mcmoran drilling. why did they have to spend 70% premium to buy these things? if i wanted to buy them, i could have bought them a lot cheaper, i wanted a copper company. i think that's why people were

unhappy today. the global stock market raleigh are doing great. and the bond market is doing pretty good. hong kong 52-week high. german 52-week high. france 52-week high. bombay, india, 552-week high. not a lot of rosy news out there, i know it sounds word to see all these stock markets with 52-week highs. there's not a lot of good news, and yet, still, we get record yields. we had a french bond auction, i don't normally talk about the french bond auctions, but i have to note, 1% on a six-year? record low yields, 1.27 low on a 7 year. the 15-year they had was record lows. we have this poor outlook, we still got the bond market flying, prices are way up here,

the ecb's got everybody's back. a remarkable move in europe, a lot of people have been wrong and betting against him and been wrong. and a key point of course is central bank activism all over the world is helping prop up bonds and stocks, bank of japan, bank of england, federal reserve, the ecb, everybody out there has basically got bond investors back at this point. important thing moving on about the fiscal cliff. the biggest story passed around here this morning was the politico article where they finally put a name on making a deal. the 37% solution, just split the difference between 35.6% and 39.6% increasing taxes and call it the 37% solution. that's the article everybody's been passing around today. on apple, just a quick note on apple here, there was as many notes out as there were analysts on apple. the main point on it is that most agree is that concern on

iphone sales are the number one problem. att made a comment yesterday, that basically sales were the same as last year than the first sales of the --. a lot of t back to you guys. >> actually, i would be encouraged if i were an apple shareholder that the stock actually opened down today. if there's any hope. italian bonds getting hit today too. of course worth keeping track of. okay, let's shift the bonds into dollars. >> we're going to stick with that european theme and when bob pisani says central banks and activism in the same sen tes, i still have good bumps, they're not good goose bumps. many say that -- if you look at intraday chart of the euro currency, you can see clearly it

been affected by his comments whether it's slowing growth, which-all know but he's putting a face on it. or there was discussion about lowering rate, look what happened in this country, we have lowered them down to zero, i don't think the issues have come back to do what they were intended to. but nonetheless, euro is down, it's range 30.90. the bund, an intraday, when you open it up, these are lowest yields since august 2. and there's a lot of issues. and when you come back to home turf, sandy makes it a little bit fuzzy, just like tomorrow's jobs report. and you can see rates are down. and how's our come holding up, we have extend it, we went from three weeks to basically three months. should we close, i only talk about them in the context of

closing yields, should we close them? it would be the lowest closing mark since august 3. let's check out energy, metals and sharon epperson tonight. >> you have to start with the dollar when you're looking -- relative strength of the dollar, in light of what rick was just talking about, and the influence that that has had on the euro zone and what we're seeing and anticipating for next year, the relative strength of the dollar, that has him pacted commodities. the zboeld contract, the very technical level has been reached there, it's been below it's 100-day moving average. it's still firmly below that $1,700 level. that is going to be peak for gold. and in terms of energy after the bearish fundamental data we got from the energy department yesterday, we're continuing to see a risk off trade in the energy complex here and we're continuing to watch more than a

dollar slide here. there's a lot to look forward to, david, on this front with the opec meeting next week as well. back to you. >> thank you very much sharon epperson. >> we did want to note for the viewers, a fairly large hedge fund that was in the news for not good reasons. diamondback capital management, a fund run by richard shimmal and larry kipanzi. richard schimel is the e ex-brother in law. lock capital management. two of those had already closed. level global has closed, in fact one of us founders, andrew

chasen is on trial right now. diamondback went down to about $2 billion, but as of this morning, that is no long ter case. the hedge fund saying that given redemption requests came in about 26% of total asset ors $520 million. it would be left with $1.45 billion apparently that's just not enough to run the successful hedge fund. they did have 140 or so people working for them. not sure how much they have trended that. as of now, their seven-year track record at this point. but they have spending redemptions as you might expect. rushing all of the assets to fund holders. often times in these cases, you'll see people run out and look at 13, and say oh, what are they going to be selling? but they have already sold a lot in anticipation. so don't look for any ability there to kind of drive them even

further down, because oftentimes they will sell their biggest positions. nonetheless, another large fund, i will assume a lot of that money is the founder's money as well as is often the case. and oftentimes we see a high water mark that disappears and they will come back if they k but this seems to be an overhang, because they settled with the sec, they never were charged criminally as well. >> did you find it shocking that the "new york times" devoted so much of its front page? >> yes, that story will just continue and he attracts a great deal of attention, even though he's been charged with absolutely no wrong doing at this point. >> nothing. >> well, okay. i mean i don't know. if i were in the hedge fund business, very tough times. >> we'll take a break here. when it comes to invests in the stock market, are americans more

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apple ceo revealing which industry the company might be revolutionizing next. in an interview with brian williams which airs tonight on nbc's rock center. tim cook says when i turn on my television, i feel like i've gone back 20 years. it's an area of intense interest. what's tim cook going to do to revolutionize the television? go to twitter, we have got your comments throughout the monk. >> clearly he's referring to the

visceral act of our television, not the content, because we know he's quite a fan of "squawk on the street." >> and i think this is my omg, the question that will rise, put to me from biographers, are there any omg products. and it would be programming seri. and we'll go "squawk on the street" right now. >> people would watch that over homeland. homeland would drop. >> that would be terrible for show time. >> yeah. >> just for the record -- >> what are you doing? >> i was just kidding it was a tease. >> sh show is captured, of course "saturday night live," an nbc show says it has done a very

funny thing about people during handy. >> show time, show-time, best margins of anybody. >> have you talked to les about it? >> very close to me, he's a nice man. i have got bmw executives wanting to buy my mexican houses, just so you know. >> the ceo of one particular company is hoping you'll get your kicks when shopping this holiday season. we'll explain later when you meet him in the show. but up next. coming up, it's not exactly ocd behavior. but it's suddenly something requiring order and nobody does it like jim cramer. six stocks in 60 seconds when "squawk on the street" returns. ♪

welcome to the world leader in derivatives. welcome to superderivatives.

the former vice chairman of the federal reserve, alan blinder will join us to talk about the fiscal cliff and qe-4. not many hotels are being built in the country today. choice is breaking ground on three new hotels. they're also the originator of

the obama special dividend. >> let's get six at 60, six stocks in 60 seconds. let's start with lions gate in gold man. >> i'm going for hunger games. gold man doesn't seem to care. >> this is a very hot stock. it's a limb late. >> oppenheimer, buying a hold on auto zone. >> i thought it was a really good buy back. one of the hottest stocks for a long time. the big data, i would be careful. >> u.s. wine guard to sell. >> good yield, bricks and mortar, fine. here's a company that's going to be on tonight. i thought this call was really bad to say sell, i liked the quarter. but everybody's worried about retail and fiscal cliff, carl and fiscal cliff was mentioned in the release.

it's become something carl that we are expecting in every release that we see. >> we do have a couple of seconds to point out that last night in cable fax awards, two nights ago, you were named to the hall of fame. >> yes, thank you very much. kind of proud, i dedicated by admission to mark haines who put me on tv. when david and joe would do "squawk box," he put me on tv. and mark was inducted into the hall of fame last year, because he said there's room for like guys that were bald and fat. right then i was trading at 2.15. now it's a point lower. >> no free passes. >> well deserved, congratulationings from all of us. you're going to stick arounder for lululemon. >> speaking of which, coming up, the ceo of lululemon will talk to us about the holiday season. and apple, a slide back into

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let's get to the road map for the next hour, deal or no deal. alan blinder's open letter to congress and how he feels the deal should get done. >> and checking charts on apple. a technician and an analyst lay it all us. >> the ceo of lululemon will join us. >> we'll -- we are watching apple today, now in bear market territory, america's darling stock coming off the worst -- technicians, keeping a close eye on the debt cross for apple as well as the main lows.

1,111, katy stockton is the chief market technician with mk and partners. brian, i'll start off with you since you're here on set. you said you just came off of a big marketing troip yet. what is your opinion on what's behind this selloff? >> i think it's tax relateded selling. few stocks chair s compare to performance that apple has given you. if you're a long investor, you think, the other guy knows more than me. trust me the other guy does not know more than you. it's just that fundamentals are deteriorating as the stock falls and people feel they are missing something. they're not missing anything. this is a tax related selloff and it's a tremendous buying opportunity at 7.5. >> we're seeing the pressure from the institutional side,

probably pressure from the -- individuals might just simply get frightened off and now the result in selloff will lead to the stock being in stronger hands? >> i think that's exactly right. i think a lot of these investors will come back to apple after the tax related selling, whether that's in a week or two or sometime this year. >> we have a half dozen technicians focused on the selloff. historically they're only up 4, so a phenomenal november for the apple monitor, which are suppliers to apple. >> today just in today's session, apple has performed pretty well, the stock was down as much as 3%. and once it hit the may low level area, it bounced off and pear

pares his its losss. >> what would i would need to be concerned is a consecutive selloff. i think that we will see apple avoid that breakdown and i say that for a couple of reasons, first and foremost, it's coming off it's most oversold condition since 2008. this correction or pull back is following a 17.5% rebound from support. so it's too early to call to breakdown. i think that breakdown might be avoided and really momentum is not as bad as it cements from an intermediate term perspective. to talk about the death cross, getting very close to that 200-day average. that's what's freshest in people's memories, we also saw that death cross in mid 2006. and of course that gave way to a multiyear rally. >> let me ask you about china, which is the golden price for apple. in particular, china mobile.

700 million subscribers, it still isn't on that network. and overnight we had some comments on the ceo of china mobile saying they're going to play hardball extracting as much value from apple as they possibly can, at a time that nokia is up 35% from off the lows, in the wake of its new smart phone in that market. where are we on expectations for volume and margin in china for and until is. >> so what we have talked about in terms of apple in china mobile is something probably in the second half of next year. you're not going to introduce a mid year iphone. we have been talking about that, we did meet with a lot of the carriers in october and we came aback and exactly what you just said. they're going to play hardball with apple.

>> is iphone is very similar. there was no status to having a new iphone. it looked just like the old one. iphone 5 is totally new. >> we're in a month where everybody's talking dividends. our investors, the ones you talked to, are they frustrated by the lack of movement on that front from apple? >> i think they would like to see a higher dividend and greater buy back. let's target a buy back of 50

billi billion instead of $10 billion. they're going to have attend of 2015, half of their current mark cap in cash. i don't think they will go a special dividend. i look forward to dividend heights to take place in the next few years. >> the last debt croath cross y mentioned was september 2008, but we didn't actually see a new clear buy signal until six months later in march of 2009.

>> i really think we should focus on the up side for apple, even though it might pull back another couple of days here, whe where -- beyond that we're looking at the september high arrange 700. so remember the death cross is a lagging indication of the correction of more than 28% that we saw from that september high. >> brian, just before we let you both go, tonight's nbc has the first interview with tim cook since he became ceo. it will be with brian williams at rock center. he said whatever you do, don't

go through the -- do you think that tim cook might be little bit too imaginative do you know the road with too much to play with, with the possibility of launching apple tv, when we still don't know bha quite what it might be? >> i think he's a very disciplined an rational ceo. i don't think he's going to do crazy we'lls. i think he's going to stick to the basic premise of apple. we make the greatest products in the world. that's what we're focussed on. and that is the culture of apple and that will continue and that is what will make apple great. >> guys we're going to leave it there, katy stockton and brian white, thank you. tim cook being interviewed by brian williams, that is tonight on nbc's rock center. 10:00 p.m. on your local nbc station. meantime, house speaker boehner and president obama speaking on the phone last night about the fiscal cliff. there still seems to be a freeze in the negotiation.

>> there's nothing going on privately that's not going on the publicly. >> they've got to come with some specific revenue. they have refused to do that. >> we need that consensual break through. >> although the president seems obsessed on raising taxes for you. >> that is a bad strategy for america, it's a bad strategy for your businesses and it is not a game that i will play. >> is the administration prepared too go over the fiscal cliff? >> oh, absolutely. there's no prospect to an agreement that doesn't involve those rates going up on the wealthiest 2%. remember it's only 2%. >> with just 25 days to go, the political satandoff could cost the u.s. millions of jobs. professor, good to have you back, good morning. >> good to be here, thanks.

>> good read in the journal yesterday from you and if anybody needed to worry about this more, you invoke carter, you're talking about 1980. kind of scenarios if in fact we go over the cliff? >> yes, i can't stop thinking about that. you had a case in 1980 where carter invoked in an anti-inflationary gesture, credit controls which economists thought were a terrible idea but a lot of political people were telling him was a great thing to do. if you actually looked at what they did knew me numerically, b doesn't look that great. people put away their credit cards and the economy just tanked. >> even though we have being faced with people who say let's go over this cliff. you say back then, policymakers grossly underestimateded the psychological impact? it's your sense that if in fact

this happens, consumers will be more willing to shut their wallets than we think? >> i'm afraid, you know, nobody knows, i'm just worried about that, a key difference between this fiscal cliff and what happened in 1980 is that there is real meat and bones in this. one could have argued before it happened that those credit controls wouldn't happen or they wouldn't have much effects. nobody thinks that if you're not 4% out of gdp growth in a single year or in a year and a half or something like that. that that's not a big deal for the economy. everybody recognizes that it is. >> we keep hearing from critics that say, look, we get a frame work, it doesn't solve the long-term problems, it just kicks the can. you're in a position where you'll take some can kicking at this point, right? >> exactly. i mean, look, people like me started talking about this a year ago. i wrote a piece in the "wall street journal" in march about this. we have known about this forever, well, not forever, only since it started, and it's just

being frustratingly little action. at this point i don't think they have the time to do a full deal and that's why they need to kick some cans. >> you say reaching a grand bar ga -- bargain is a dream and i mate be just that. there's a growing sense that the president in his words has won this round. do you think this is how it shaping up? >> i think so, i think he's got a much stronger bargaining position. he put out an officer that was way off where he knew republicans would be, prepared to come back on it. but that was a sense of the strength that he thought he had in this position. and similarly, you just had that little snippet from tim geithner saying we're prepared to go off the cliff if we need to. they don't want to go off the cliff of course. but they feel they're in a very strong position. >> the impact is frifgtening and you wrote that in the second quarter of 1980 that it was

actually in the history of gdp, where the interest rate jumped from 3% to 6.3%. so in 7 1/2 months the damage was done. what do you say to the polity makers out there about the notion that you can go over the cliff and then ratchet yourself back with little damage. >> i just don't like that, there is a scenario that says that some people believe, go over the cliff and in about two or three days we'll have it all settled. if we knew that was going to happen, i would say go right over the cliff, two or three days is not going to do any harm. suppose it's two or three weeks, suppose it's two or three months. you get the two or three months, you've got a recession on your hands for sure. >> as you point out, maybe three points on unemployment, that is a scary problem situation. processor thanks, howard winer from princeston.

>> fresh off of lululemon's conference call, the ceo joins us. >> do you need a good deal on a hotel room? choice hotels which owns the comfort in, quality, as they break ground on three new hotels here in new york. if we want to improve our schools... ... what should we invest in? maybe new buildings? what about updated equipment? they can help, but recent research shows... ... nothing transforms schools like investing in advanced teacher education. let's build a strong foundation. let's invest in our teachers

so they can inspire our students. let's solve this. i heard you guys can ship ground for less than the ups store. that's right. i've learned the only way to get a holiday deal is to camp out. you know we've been open all night. is this a trick to get my spot? [ male announcer ] break from the holiday stress. save on ground shipping at fedex office.

it is interesting to zero how -- the guidance is below street consensus and looks immediately through it because they think you are sandbagging that guidance. so walk us through the deceleration in same store sales growth. why are you giving this forecast? is it capacity issues? what is behind the slowdown? >> i don't think it's really capacity issues for us at all. i think we have great product in the store right now. we definitely lost some momentum in the middle, or the beginning of the quarter in november. where we had some technical issues with our product notifications, which we send out to guests, so we weren't driving traffic to our stores or to our e commerce sites, i think just in general, the unsettled

consumer and things that were going on. we lost the momentum. i think the only question for us is will we be able to build that back through the balance of the quarter. we believe we have done everything we can do with products in the store and great guest experience and we feel that to the most productive weeks are in front of us. >> you talk about international. i don't want to put up a lot of new stores in america. it sounds like the next growth leg will be international. are you saturated? i do see a lot of lululemon products in every store i go to these days. >> we do have our own stores, especially in the wholesale channels. we have a lot of same store growth in the u.s. and we're not going to go to the c-malls or the outer chairs. we usually use our e commerce reach for that. but we have got a very solid new store growth strategy in front

of us as well as planting the seed for international and planting the seed for strong men's growth. so we will see our e commerce sales along with growth sales and international will continue to drive the growth of the company going forward. >> and another issue for me, you talk a lot in the press release about comparable store sales, and it sounds like a definitive slowdown and you also talk about the direct consumer channel. should we now regard comparable stores as not the important metric for lululemon? >> in the u.s. where our sales square foot -- you're seeing great growth in our sales per square feet. >> i want to talk to you about the shorts in the stock. it was an interesting move in your stock on october 7, when lulu shares lowered on news that

david einhorn was not a short seller in your shares. have you talked to david einhorn, has he called in to any of the conference calls, has he engaged you in any way? >> we are aware that he has been in on some of the calls but he has not engaged us in any way. i think it would be -- typically he looks at far more distressed companies and our company is a financially well run business with a lot of growth opportunities in front of us. we can't play with the shorts. our job and my job is to run a great business and that's what we do quarter after quarter and i think we have a great track record of doing that. >> just to recap, you seem very nervous about the coming weeks partly because of the fiscal cliff. people who already train and who work out regularly, you're one of the ultimate kind of

discretionary expenditures, of those things that people might cut back on going into christmas. >> i think it's an unknown, i won't say it worries us, i think we have a very core guest and i think that gives me a lot of confidence in the back half of the quarter is the very strong sales that we have seen starting in october through november, we have seen a great acceleration so we know that we're a very giftable item and we would expect to see strong gift card redemption sales and so i think there's a lot of things that give us confidence that we can have a great quarter. >> christine, how big can men's be. i'm trying to figure out if you can be like nike. >> i think from there's a huge market still that we're actually creating in the athletic technical wear space as well as the technical street, which is a very big market and without

putting a time frame on it, we definitely see ourselves with a bigger than $10 billion business. >> christine day, ceo of lululemon. >> you can kick it with a shopping bag in your hand. we'll explain later on. plus choice hotels just rang the bell here at the new york stock exchange as they get ready to break grouped on three new locations here in the city. he'll join us live next. [ male announcer ] at scottrade, you won't just find us online, you'll also find us in person, with dedicated support teams at over 500 branches nationwide. so when you call or visit, you can ask for a name you know.

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welcome back to "squawk on the street," i'm mary thompson on the market flash. we're taking a look at jp penny, on an otherwise down day, we see 10 million shares traded with almost an hour having passed in the trading session. no news, but we're keeping watch on this, a big move on jcpenney of just about 6%. >> ringing the opening bell. ground breaking of three new hotels in an industry first is

choice hotels international. welcome its president and ceo, steve joyce. there aren't many hotels being built in america at this moment. that's one reason why people think they'll be able to raise prices next year. what you're doing is very unusual, why? >> we have got a new brand, choice is for the first time breaking into the upscale space, there are a number of deals we were working. we agreed to co-invest with them, we got the deals done and we're here breaking in the first 24 hours, breaking ground in arguably the city with the most hotels. >> you have had to step in and help finance and own the hotels for once in order to get movement there. why was it the priority on that? >> well, one because of financial condition and the financial circumstances for raising money for hotels has been tough for several years. two, we're trying to launch this brand. three we're working with partners and most of our

position is a sliver equity or a sliver debt position. they're going to take us out of it and we'll recycle that into great hotels. it's a great opportunity for us now, probably better than any other time. because when we bring that capital to bear, we bring a real difference in that happening. >> this is a one-year chart of choice, something every investor in this market should be totally aware of. choice was first to come to market with a special dividend, they declared it in the summer, $600 billion, the family could get the money out i assume for tax reasons and the shares had an extremely sharp fall. is what you're doing today saying to the market, i'm still not con trained as a ceo, i'm not not overly leveraged, we still have growth? >> that's what we said to the market wen we did it. we paid out $600 million, the market gave us $300 million of

it back. it's been a very positive movement for the shareholder, but we have plenty of cash to continue to grow in company, cameron suites, one of the biggest -- as well as return value to the shareholder. >> one of the reasons that your stock has gone nowhere over the last five years, is because people wanted an international strategy. it's interesting this time you've chosen new york. >> for a launch in cam bri owe, which is our priority today, we are putting money behind it and we're going to put a lot of energy and passion behind it. we have 1,200 hotels internationally. we have a technology platform. you're going to see us in a big particular in europe, and that's going to lead to a much bigger -- >> is there any dangerous in an industry at large, one

overbuilding? getting them into the hole they have classically gotten themselves into? >> no one's building any hotels as you mentioned, the ones that are getting built are special sponsorship with special support. and what's happening in the hotel business, we're getting steady demand growth, so with no new supply, no new hotels coming on until at least 2015, the hotel business is strong for the next few years. in '15 and '16 when the money coming back, but this is a long-term run for the business because we have had such a slow recovery. >> the ceo of city ty became off last week. he's saying he's seen softness. he's seen softness last month and this month. what are you seeing at the moment in your business ". >> we had a very strong through three-quarters, we haven't announced our earnings yet, but if you follow smith travel,

november was a huge moth. we are smith travel, if you look at those numbers, it's a very positive environment. the fiscal cliff will affect people when employment gets affected. this is a real issue. if you see something occurring with employment, we're sensitive, we're monitoring, we represent the folks that are going to be most affected if they don't do their job in washington. we're obviously concerned about it. if they deal with it, which we think they will. we think that next year should be pretty positive. >> meanwhile big party tonight? >> big party tonight, big party last night. >> that's what the city's all about. >> we'll be opening white plains in may, it will be a little warmer than it was up there last night. it's very exciting to see those hotels get done. 1,000 jobs for the city. >> you see at the bottom of your screen, nat gas inventory. >> listen natural gas prices are extending their gains from yet,

after that 4% rally that we saw. we're looking at resistance perhaps around the 4.75 level. we saw a natural gas level that was certainly not what analysts were expectings. 65 billion cubic feet which is much greater than what the consensus was. that was between 64 and 68 million cubic feet. but it's also far greater than what we normally see this time of year. greater than last year's withdrawal. greater than the five-year average and it lets you know that we saw much cooler temperatures last week that certainly increased the temperatures and the heating demand. now there's milder temperatures. there is a question as to whether or not that will remain. but we are looking for some forecasts for temperatures to get colder later in december. that could help natural gas prices rally.

>> after that weather forecast yesterday, it's getting cold here in the northeast. meantime zynga shares flying on noon. will this potential new market be enough to revive their business? we'll talk about that in just a moment. [ male announcer ] this december, remember -- ♪ you can stay in and like something... ♪

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♪ about an hour into trading, some of the stories we're squawking about. safe way shares up 7%, with the fiscal cliff on it's radar, the supermarket chain accelerating it's improvement from january. the ecb slashing it's euro zone economic forecast for next year and the average rate on the 30-year fixed mortgage up slightly in the past week. now to a story we have been following for a while now. guatemala police arrested john mcafee last night for entering the country illegally. >> john mcafee thought he had finally made it to safety when he reached the shores of guatemala this week, but his troubles it turns out are just

beginning. mcafee, the gun toting software tycoon, is on the run after the murder of his american neighbor in belize. police are seeking mcafee for murder. he says he has nothing to do with the murder. after hiding for three weeks, he fled to guatemala and is now seeking political asylum. he thought that guatemala would be safe, he hired -- it turns out the plan was foiled last night when guatemalan police arrested him for illegally entering the country, if he gets asylum he can stay, but i'm told this is not likely, what is more likely is that he will be escorted by police back to belize, once at the border, he could be picked up by belize police and detained. what happens after that is anyone's guess. he could be charged in belize or

if mcafee can be believed, he would disappear. i find it difficult that he would disappear back in belize. >> it comes sometimes in life when you have to seek asylum in guatemala, and you're arrested at the border for illegal entry, it's not going so well. >> that's what we were all thinking. >> things maybe take a little bit of a turn there. >> meanwhile, shares of zynga getting a boost on news the company has filed for a gaming license in nevada. the question is should you place your bets on that company. ken sane has an underweight on zynga. looking at your math on the impact, the potential impact of this opportunity, i'll let you say it because it's not a lot? >> it's not a lot. we value it at about 20 cents

per share given that zynga has close to a billion shares outstanding and we really look at it on a global bases and there's just not a lot of countries where online gambling is legal. and it tends to favor the brick and mortar legacy casinos because it provides more jobs and tax revenue. so this is a long shot. >> $1.30 in hard assets. we talked about their minimal cash, 20 cents in the core business, 20 cents in the gambling option. and that gets you to $1.70. >> there is the potential for more value there, so i'm not necessarily saying it's short. but we still do continue to see this as sort of a risky bet. excuse the pun and so we are underweight on it. >> and we should point out, ken, that there are some very experienced.

if it did open here, zynga would have that to contend with as well. it did not provide a lot of revenues and the option of it becoming more legalized and more broadly in the u.s. as very slim to none. >> we had pinkas on one of the morning shows, the broadcast morning shows this week with regard to facebook. we were still bffs, best friends forever. is gaming in nevada, is that the best card they have to play right now? >> i think it's something that they're playing up, but i think in truth, what matters a lot more is that they can just show that they have the resources to build games that people really want to play and that those

games are kind of agnostic of bedevice, they do translate to mobile. i think that should continue to be the core focus for them. online gambling is an equally competitive area as online gaming. but you're also looking at a business that's very risky, and you could have regulations pull the rug out from under them at any time. and the stock is trading very low too. >> we had some breaking news in washington. >> some interesting developments here in the united states senate, senator jim demint, a republican in south carolina has announced this morning that he's going to leave the senate in january, he's going to take over the leadership of the conservative heritage foundation, starting in january. so he says he's still going to be an influential player in conservative politics just from the outside of the senate rather than in. this has some bearing on this week's debate over the fiscal cliff negotiations because

earlier in the week on monday, senator demint put out a press release saying he was opposed to speaker boehner's office of $800 billion in new taxes. that was sort of the brush fire on the right that we saw a resistance to speaker boehner's position. now senator jim demint announces that he's going to step away from the senate entirely. he had already said that he was going to retire, so he would be leaving the senate eventually. and this eases the path a little bit for speaker boehner to continue those negotiations with the president. and we know that boehner and the president had a phone call just yesterday, late in the day, we don't know exactly what they said in those conversations. so that's the news here in the senate. >> it's still happening in a broader narrative, dick armey has had a fallout with his group. we' i wonder does this mark a new chapter in the future of the tea matter? >> absolutely it does, and it marks sort of a post election reckoning among conservative

forces generally in washington and across the company. we saw a jack kemp yesterday where he had marco rubio and paul ryan addressing crowds. the republican party is trying to figure out where do we go from here and there's a lot of moving pieces as part of that. >> stu very much for that. of course here, we're keeping an eye on apple, a big turn around right now as you can see, up $4.41 after yesterday's 6% selloff. i heard in the show why one shareholder is sticking by his claim that the shares could hit $16.50 so that you would treble your money at the end of 2016. >> find out next just how many people believe right now is a good-time to invest. stay tuned. [ male announcer ] when it comes to the financial obstacles

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want to get to steve leaseman with more of an economic survey on the heels of that great interview with geithner. >> thanks very much, we did a nationwide poll with 805 americans, all different income groups, all different regions, i want to show you the results here, when it comes to the stock market and what americans believe. first only all, when it comes to is it a good time for a bad time to buy stocks. pretty much average negativity. secondly, when we look at is it a good time, that's when you get less optimism. so the pessimism is about the time. when i comes to uncertainty, which you'll find right now, it's pretty much, uncertainty is down, pessimism is down. when you take a specific look at the financial elite, and what you see here is that those who have $75,000 in income or 50,000 in the market, they remain

pessimist pessimistic. let's look at the last quarterback in september when we looked at this. 50 to 34 and then again, this is the new results right here, 48. so the optimism, that's come down a bit, 55% to 49d%. now let's take a look at the debt side of the equation. americans and their debt levels, do they feel like they have a lot or some. just 15% say they have a lot. and when it comes to some, how about 33%. when it comes to no or just a little debt, 51%. those numbers are pretty much unchanged from the holiday season last year. how does debt affect holiday shopping? very interesting. take a look here. if you have more debt, you're spending $584 on afternoon this holiday season.

some debt $680 and it's going to go up. $742 is the average. if you have no debt, what are you going to spend? $910 so a definitely connection between debt levels and how much you're going to spend for christmas. >> still ahead on the program, the co-chair of the campaign to fix the debt, former senator judd gregg will join us as he basically tells us who he believes is standing in the way now of a fiscal cliff solution. we're back in two.

it wasn't until the debt ceiling lauz but born with an . >> you know, i beg to differ, mr. president. to me, i understand the use of its is a weapon but to me the real problem isn't the debt ceiling. it's the debt. the debt is the problem. you know, to have an unlimited amount of money to call upon is

too much power power for one person. it's always in our country been about checks and balances but i think this administration just wants more checks and no balancing of the checkbook. that isn't the kind of check and balance that i think the people that wrote the constitution had in mind. now, let's look at it a different way, when we think of, you know, some good entertainment, there's, you know, bob hope, the road to morocco, the road to singapore. i don't think that we want to have a movie someday called the road to the weimar republic because bob hope was in the old movies. there's no hope in that new movie and i think this issue really has to be discussed. now i understand there's issues about compromise and everybody has heard that the president and the democrats won the white house. i understand that but the debt ceiling is a serious issue. as nasty as it might be and

credit ratings might change based on the dynamics of how this perpetuates itself when we hit the debt ceiling probably in the next eight to nine weeks but truly congress has to have some say-so in this and the people that put those people in congress have huge opinions and finally, i say less m&a on the government side and yes, i'm not talking about mergers and acquisitions, i'm talking about our money addiction. carl? back to you. >> jim, on demint, what does it mean for the party, can he be more powerful outside the senate than inside? >> i think mr. demint is the perfect guy to run the foundation. when we talk tea party there isn't a bona fide leader, it's a bunch of fragmented groups. at the epicenter of what made it a wild growth movement is because of the common denominator of fiscal responsibility and i think jim demint will bring that to the forefront even though it's a catch-all for a lot of groups

that have other motives besides fiscal responsibility. >> rick santelli thank you. apple's ceo revealing which industry the company might be revolutionizing next in an interview with brian williams which airs on "rock center." tim cook says when i turn on the tv i feel i've gone backwards in time 20 to 30 years and adds it's an area of intense interest. i can't say more than that. that brings us to this morning's squawk on the street, what is apple going to do to revolutionize the television? we have your responses next. try running four.ning a restaurant is hard, fortunately we've got ink. it gives us 5x the rewards on our internet, phone charges and cable, plus at office supply stores.

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ishares by blackrock. call 1-800-ishares for a prospectus which includes investment objectives, risks, charges and expenses. read and consider it carefully before investing. risk includes possible loss of principal. "squawk on the street" for thursday in an interview airing on tonight's "rock center" tim cook reveals to brian williams that television is a "area of intense interest." what's apple going to do to revolutionize tv? your answers, bob writes provide an option to automatically mute commercials. >> not a good business model. >> add cup holders, rick writes. travis writes apple's new itv

will give the ability to watch for long periods of time without making your "i" hurt. do we not have a symbol crash? what's coming up? >> kneel kashkari says it's not a fiscal cliff, it's a hill but he's buying stocks and has specific names and a deeper dive into the prospect of exporting natural gas, what happened to this manufacturing renaissance that cheap gas is supposed to provide in the united states. we'll get into the issue. >> we've not covered enough of europe. >> there is a possibility the italian government could fall. >> the "b" word, berlusconi, incredible. see you later. if you're just joining us here is what you missed earlier this morning. >> welcome to hour three of "squawk on the street." here is what's happening so far. >> a sound fiscal position is necessary to protect the economy. >> okay.

>> if we don't do that, as this economy recovers, that recovery is going to be aborted and that's going to do damage. >> 370,000, a drop of 25,000, because the 393 originally released last week was upgraded a couple of thousand. >> people are truly perplexed about what the stock is, where it got to, what do you do with it. >> so you can come up with a million reasons. it's manufacturing, well, maybe it is manufacturing, but is there really a demand question about apple's products? [ bell ringing ] >> there is a scenario says and some people believe in it, go over the cliff and if about two, three days we'll have it settled. . look if we knew that was going to happen i'd say go over the cliff. two or three days is not going to do any harm. suppose it's two or three weeks, suppose it's two or three months. you get to two or three months

you've got a recession on your hands. >> we're checking our lists as the "squawk on the street" countdown to christmas continues. ho, ho, ho. ♪ up on santa claus mountain, christmas all the time ♪ ♪ toys and dolls and christmas trees ♪ >> thursday morning, we're live here at the new york stock exchange. check on the markets, dow hanging on to 17 points, continues to pivot around the flatline to the tune of about 20 or 30 points, s&p is up about 3, 1412 last check. zynga is up sharply on news the company is applying for the real money gaming license in nevada. the move "continues our strategic effort to enter the real money gaming markets in a real way." macpoint's down again, stock getting hit with six different downgrades today in reaction to that deal. our road map goes like this,

apple trying to recover from its worst single day percentage loss in four years. is it still a buy? and then the fiscal cliff blame game, new data on who americans blame for the gridlock in washington plus is congressional leadership holding up negotiations in d.c.? former senator, co-chair of the campaign to fix the debt judd gregg is here with his take on that. the death cross is on for what was once the favorite name apple, shares rebounding back to 547. is this finally the opportunity to get in? alex gauna is an analyst with jmp securities. good to have you with us. >> good morning, thank you. >> a lot of discussion how technically some defenders say apple is exacting exactly as it should. do you see it that way? >> technically i think the

dangerous thing is this stock forms a head and shoulders and i don't know where the support comes in, somewhere in the 400s. that's a key risk to the stock. i focus on the fundamentals. it's worrisome in the near term for apple. when there's a lot behind that, the relationship with samsung the frenemy relationship has gone to enemy. also the closing competitive gap between apple and rival products out there, so many of those that have subsidized business models and have zero margin devices. we're neutral on the name and i think at this juncture we'd be cautioning against calling this up overnight. >> does any of your neutral thesis incorporate year-end profit selling, lack of a dividend, anything separate from the ongoing fundamentals of the core business? >> there's a lot of that. there is that fiscal cliff worry out there, it's a real concern. there are the tax implications here and the profit-taking that's under way right now and i don't know that we're done with

that and just in general a macro economic environment and so much of the apple story is still consumer products and there's pressure in those areas, comes right back to gross margins and what can the business model support right now. those are a lot of reasons why they're neutral. >> when do you get more positive given your latest checks are fairly favorable in terms of products, retail channels, it's clear that they have a pretty big moat when it comes to tablets. at what level do you get more positive? >> i think you're tempted technically and earnings power perspective as well as the dividend gets above 2% and i think that's attractive for many people. you're right, the holiday checks we've done, black friday and the commencement of the weekend through cyber monday all checked out favorably for apple. i think they're still the hottest going brand in town and that should make for a reasonably strong earnings

season, with the one caveat of that gross margin line. that's a key head wind and question mark for the stock right now. >> would it surprise you to see them come out with a big product launch that comes as a surprise? cook is hinting at something regarding television in his interview with brian williams tonight but that clarity could come relatively soon if they wanted to. >> i would have think we would have heard more buzz if they were to revolutionize that aspect of the market. apple already has with what's going on with itunes and netflix and youtube, television is rapidly revolutionizing before our eyes. ipad is a huge part getting content to those devices so the revolution is already on. i don't think we're going to have any blockbuster announcement between now and year-end and i would say that the blockbuster announcement that should have come should have been the one netflix made, apple should have tied up some exclusive right with disney and they didn't do that. >> alex, appreciate your time.

thanks so much for coming to the phone. >> thank you. >> alex gauna from jmp. mary thompson is back at headquarters with a "market flash." >> david novak saying he was expecting solid mid single digit same-store sales in china, its largest market. it comes on the heels of last week's forecast that same-store sales in the country for yum brands which operates kfc amongst other restaurants would decline 4%. he expects same-store sales to be stronger in china. the stock is up about 2.5%. carl back to you. >> mary, thanks. when we come back who do americans really hold responsible for gridlock in washington? we'll find out. co-chair of the campaign to fix the debt former senator judd gregg joins us live to tell us why congressional leadership could be standing in the way of a solution. first rick santelli is working for something later on

in the hour. >> in about ten minutes we're going to have ira harris and have some interesting topics. ira harris has a notion of who may be most impacted if we go over the fiscal cliff and i don't think you'll be expecting the answer he'll give and touch on mario draghi and ecb, maybe a little berlusconi all coming up in ten minutes. [ male announcer ] how do you trade? with scottrader streaming quotes, any way you want. fully customize it for your trading process -- from thought to trade, on every screen. and all in real time. which makes it just like having your own trading floor, right at your fingertips. [ rodger ] at scottrade,

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some new data says americans will equally blame democrats and republicans if we go over the fiscal cliff at the end of the month. john harwood is live, good morning. >> good morning, we're tracking what pressure exists from the public from voters on members of congress on the administration for resolving the fiscal cliff and there are a couple of findings i want to run through. first of all there is more public pressure on republicans to compromise than on democrats. if you look at the results of the survey, 20% of americans say the message of the election was that republicans need to compromise with the president. 9% said that the message was that president obama needs to compromise and the plurality, 44% said both ought to compromise. those results aren't so surprising because president obama won the election but if you look at the number who would be to blame if we don't get a deal, you see 21% blame the president and democrats in

congress, 23% blame republicans, pretty even, 52% says they blame both of them. some other surveys have shown president obama with a stronger hand. we looked democrats in congress together with the president, any time you lump congress in a question it drags down the number. finally if you look at the intense partisan split on outlooks for the economy, this is something that is relevant as we try to measure the pessimism or optimism of american voters, we see now an even split among those who say the economy will get better in the next year versus those who say it will get worse but there's a tremendous partisan split there. republicans, a six in ten republicans say the economy will get worse. it's the loser's lament after the election that they become more pessimistic, democrats overwhelmingly optimistic, independents interestingly agree more with the republicans, they

expect the economy to get worse and that's one of the factors weighing down on public opinion as we head toward the last three weeks of the year's negotiations to avoid the fiscal cliff, carl. >> times a-wastin. with the deadline inching closer what needs to be done to reach an agreement? judd gregg is a former republican senator, governor of new hampshire and co-chair of the campaign to fix the debt as well as a cnbc contributor. i'm glad to say he's at post nine. good to have you back. >> great to be here, carl. >> is the conventional wisdom that the president has won this round correct and is that good if your goal is to get to a deal in the end? >> i think the president clearly has the microphone and he has the election behind him as the winner so he obviously has more cards i believe than the republicans have, but i think speaker boehner has acted very responsibly here, come forward with a very aggressive proposal.

he said he's willing to raise revenues so he's moved that needle very considerably. and to me all that needs to be done to get this deal done is for the two of them to get in a room and ask the staff to go to lunch and they work it out, because the parameters of an agreement are pretty clear. >> the speaker has not brought up rates, right? seems to be where we're at. >> he says we'll get revenue from the same people if you raise the rates. that becomes a systematic exercise. the big issue is where you get the entitlement savings. you have to have a major entitlement part of this package. you can't just do revenues. republicans wouldn't accept that and it wouldn't be the right approach anyway so they did reach an agreement on entitlements a year and a half ago that was pretty significant, a lot of cats and dogs but it was significant in the number, or alternatively they can go the route of adjusting the c.o.l.a.

which is the better route to go but both are things which are doable. it's a question of whether they get together and do them. >> you would advise the republican leadership to hold fast on the top marginal rate, not to go to 37, not to go to 39.6 or anywhere in between? >> i would advise the republican leadership to hold fast on getting entitlements in exchange for the revenues they put on the table and since the revenues will be from the same people at the same number, whether it's a bump up of the rates marginally or whether it's using a deduction cap, really, it's six one-half dozen of the other if you're honest about it. >> the white house doesn't see it that way. to them it's a statement, is it not? >> i don't know. i think the president, i think the president must appreciate the fact that boehner's gone a long way on rates. he really has and on revenue, and my sense is that there is a public exercise here and there's a private exercise here and the

real agreement is going to come when the private exercise gets serious and that's probably going to be a couple days after christmas i'm afraid. >> jim demint is leaving the senate, just announced this morning to run the heritage foundation. does that alter the calculus at all? >> no. jim was at the margin in my opinion. yes he was vocal and affected dramatically a number of elections in my opinion in a negative way by supporting candidates who couldn't possibly win because they weren't viable such as the gentleman from indiana, the gentleman from missouri, the woman from maryland -- delaware, i'm sorry, but this deal is going to be made between people who want to govern and the people who want to govern do not subscribe to the views jim has promoted in the senate. >> in "the times" this week a

budget stalemate on these temples, meaning not raising rates, will confirm every bad republican stereotype, raising middle class taxes to serve the shift and shafting sam's club to benefit the country club, they might as well wear 47% t-shirts for the rest of their lives. can you escape that even if you are unwilling to raise rates on the wealthy? >> you can escape it by making it clear you're willing to generate revenues as part of the package and the revenues will come from the same people who pay by the rates going up, and the real issue here is do you get a comprehensive agreement that's big enough to get the debt under control. this economy is ready to explode. there's no question about that. i follow the group who feel this economy is going to be very strong if we can get our fiscal house in order and to get our fiscal house in order doesn't involve revenues and it follows, it should follow the formula of the original simpson-bowles, you get $3 of spending restraint for

$1 of revenue and that type of a comprehensive package is what we need as a nation and i believe that we're moving towards that direction and the language i hear from the president, the language i hear from the speaker is not that far apart. i really don't think it is. >> calendar wise if there is going to be one, by when? >> i think it comes on the thursday, friday after christmas. i think it's going to be late, but the way the dynamics of these types of agreements work is they need to be late because you, the light of day has to be brief on them because there are a lot of people who will try to kill it. >> senator, good to see you. >> thank you. >> senator judd gregg. apple is bouncing back after its worst single day percentage loss in four years. we'll get reaction from a shareholder who is still bullish. tech and discretionary leading the way, industrials, utilities

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♪ let's get to the cme group this morning, rick santelli with "the santelli exchange." good morning once again. >> good morning, carl, i have your favorite, everybody's favorite, ira harris, can talk any topic, any time at any moment's notice. all right, everybody around every water cooler is discussing the fiscal cliff. who do you think will suffer the most if we go over the cliff? >> well i think a lot about this, rick, and looked at it over the last few weeks and to me it's the fed because the fed is on line here about the employment situation but if we believe the impact from the --

>> office of budget and management. >> which on the fiscal cliff issue we could back up to 9.5 to 10% unemployment if we do go over the cliff. >> how many jobs get lost. >> and what is going to be the fed's response to this. they're on record and this is what they're focused on. we know about the qe programs. what's coming next after that. there's a lot at stake here for the fed. >> let's pinpoint this. you're not saying that you think the programs have worked or will work better in the future. you're just saying he will be affected because he's carved out ground trying to help the economy, knowing that this is looming. >> i'm a global trader and i have to look at this and see how it's going to play out all over the place. i said who is, whose reputation is most online and the fed has a lot online. the economy is starting to get some gravity or get some growth going and that's a good thing. this is going to set them back and then it's going to look to

see what's the response, and what is the fed, and the fed is going to be -- >> the more pressure on ben bernanke. >> absolutely. >> let's look at another area. >> can i add one more point? >> sure. >> when you look at it and larry summers was on this morning, whom i have great respect for, he had the piece from the imf study when you cut the deficit by 1%, what is the impact on the gdp. they didn't get into that this morning but if his numbers he's using 0.9 to 1.4, if you lose 2% to 3% of gdp you'll go to negative growth which will impact -- >> at the very least the wheels will be on the runway. >> absolutely. >> let's switch gears, mario draghi today, listen, i was so wrong and i don't know how long it will last but i give him credit, at least for this period of time, how long it lasts because there is no growth and recession in europe i can't answer but what were your observations on that press conference? >> last night when i wrote about it, mario draghi can put his

feet up and have a stella and enjoy. he bought himself time. july 6th will be mario draghi's day of celebration because he stemmed the financial crisis in europe and bought time. berlusconi comes onto the scene this morning with the politics and italian debt markets paid a price for it, it's coming back as we're talking, rallied back quite a bit in the ten-year bond futures in italy but you know what, politics aside, mario draghi bought himself and europe some time. i don't know what they'll do with it, it will be 2013's story. >> you nailed it, to me every strategy since the crisis hit in this country in my opinion you could call it kick the can but it's about we have no idea what the effects are going to be, what the exit will be or if any of this is going to work but trying to buy time for something to happen. that something has to be growth and i still don't see how europe has a plan for more growth. >> we know greece is done with because they've already

restructured their debt and what they did in the last two weeks, which the germans said they should do, they should have done three years ago they'd be better off. spain is the immediate problem, you have 26% unemployment which is non-performing loans. >> we have to go, 2,200 pages of health care, i'm sure the notes spain's taken how greece has got money at every turn, their pile is a bigger pile than the health care plan. >> i could listen to you guys talk all day long. that was a great conversation. yra, rick, thanks so much. see you in a bit. zynga stock popping. julia boorstin is live in l.a. with more. >> good morning to you, carl. this is the first of many steps before zynga can make money from online gambling. applying for a real money gaming license in nevada is a sign of zynga's seriousness creating new revenue streams. it sent it up as much as 9% higher today. the company warns it will take

as much as a year and a half to get approval in nevada but the biggest step of all is a change in federal law, and if online gambling does become legal nationwide, zynga is sure to face some big competition from the casinos. zynga is struggling to sell virtual goods, hoping to cash in on games like texas hold 'em poker, that app and game has 34 million monthly users, but it's a long road ahead for zynga with no guaranteed success. carl? >> julia boorstin in los angeles, thanks. trading about to come to a close overseas, we'll get you the action live and pick up on that conversation that yra and rick were just having about draghi, in a couple of minutes. . . tonight our guest, thomas sargent. nobel laureate in economics, and one of the most cited economists in the world. professor sargent, can you tell me what cd rates will be in two years? no.

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the european markets are closing now. >> one question is not what the markets did today but what italian politics will look like in the next year or two, simon. >> you see it large in the market. italy in the red there really divergent from the rest of europe. germany up on the right, a good gain up over 1%, the italian market falls by 1%. silvio berlusconi is back in italian politics proving he still runs his party and withdrawing support from mario monti. this may lead to midterm elections because monti is market friendly you might not end up with a market friendly

solution. we thought we'd have elections march/april, there's the prospect it could be a snap election much earlier perhaps in the new year. now the good news is there isn't a huge amount of blowout on the bonds at the short end of the italian markets. the yields are higher but not huge relative to where we've been but on the ten-year italian market you can see we're slightly higher but no great shakes overall. it means the rally in the peripheral bond market we've witnessed in italy and spain has now stalled at this stage. remember we had the auction in spain yesterday and the yields are slightly higher relative to where we've been, they're still relatively depressed. we talk about the problems in europe, i thought it was worth pointing out amidst all the malaise what is happening in germany today an astounding manufacturing german manufacturing orders result from germany up 3.9% in october, a phenomenal performance from

german industry and it's worth bearing in mind that german industry is basically in a single currency that is too low arguably for what it should be at. the deutsche mark would have raced higher and all the loud siren voices through the summer talking about an inevitable breakup of the euro were simply wrong and you'd have made a lot of money in europe ignoring them. have a look at how the german dax has performed relative to the dow jones industrial average up 27% compared to almost 7% here, and at the top of that market, you have those big, solid, german exporters, number one gainer for the year, s.a.p., which works in enterprise software. look at s.a.p. a gain of almost 50%. exports from an artificially low currency, compare that to the performance in oracle which is up about half as much of that during the course of the year. another, byar is up 46%, pfizer,

is that a comparison, it's up 19%. meanwhile we did have the ecb meeting today and mario draghi held a news conference afterwards. they discussed moving the deposit rate to below zero therefore you will charge banks to deposit money in an attempt to force them back out into the real economy. why is he doing that because the outlook is poor for europe. the midpoint of the ecb's forecast for next year is there will be for this year a contraction of 0.5%. if you go out to 2014 carl they're still talking about growth, this is two years down the line of 0.2% to 2.2%. europe overall economically is going nowhere. however you have these very strong corporate performances and shareholders are clearly making a lot of money on the germans and the french and some of the british as well. >> the market is not the

economy, that may be one of the big lessons for the year. great stuff, simon, thank you, simon hobbs. could a key jpmorgan executive be looking to jump shirt? kayla tausche has more. >> it's been a big year of musical chairs at jpmorgan, jeff staley was replaced at investment banking ceo in july and given a chairman title many onlookers looked at it as a swan song. in the six months, two financial services companies sought him out as a potential ceo, most recently legg mason, which has seen funds under management shrink by 40% since the last time staley was considered in 2008. talks have dissolved in the last month, a spokesperson says legg hopes to name a chief expeditiously. legg follows barclays which ousted its ceo following this

summer's lie bore scandal. the board was set to see staley as one of its top candidates albeit an american and it went to antony jenkins. definitely a guy to watch who could be on the move, jes staley. >> back to bob pisani at post nine, maybe u.s. markets are not the story. >> a very strange global stock market i mentioned earlier we have new highs all over the world if you're a global investor you ought to be happy about this. let me show you here we've got new highs in germany, france, switzerland, hong kong, thailand, india is at a new high, india, south africa is the a historic high, multimonth highs in japan, and if you like investing at this level, etf international, the vanguard all world index, my favorite, you can buy the whole world x the

united states, 46 countries, stocks in 46 countries, 40% europe, the rest of the world, symbol is veu, not at a new high but close to a 52-week high in this, a global index as well, and they're bullish in the united states as well. did you see the american association of individual investors, aaii, the survey, they do this every week. bulls 42%, that's the highest level of bullishness in the united states since going back to march. it's a little bit strange, folks, don't you find it strange. is this really a bull market? we had a very series points of debating this, whether we're in a bull market. the s&p is up 12% this year, that's a good showing for the year but stock volume, trading volumes are down 19%, that's in the equity markets. options volume is down 13%, business is lousy, to be perfectly frank in the equity business and not so great in

options. equity mutual funds $125 billion in outflows. is this really a bull market when the public is voting like this, not trading as well as taking money out of mutual funds? the prices are up but carl you had a good part, the markets are not necessarily the economy overall. i think that was a good point you made. i want to move on before i toss it back to carl and show you apple. we've had huge volume in apple today, 25 million shares, it's already a full day's volume as you can see we've come off of the lows here. i'll tell you a good point, i've got dozens of comments on what was wrong with apple, everybody does. friend of mine joe zuckerman said apple is an asset class of and by itself, that 1,000 shares of apple can buy 55,000 shares of bank of america. you know that's a very good point. let me just put up bank of america versus apple. apple topped out the second, third week in september, remember that, since then there's been this eerie inverse correlation as apple has been

going down, bank of america has been going up. i'm not implying there's a spooky, weird relationship between apple and bank of america, it's not but it is an interesting observation that it's really an asset class by itself. 55 shares of bank of america for one share of apple. >> rotation to a large degree, thanks, bob pisani. one of the oil majors on the way today, mary thompson? >> modest gains for the dow and modest gains for one of the dow leaders, chevron, up about 0.8%, getting a boost from a couple of things, it's raising its forecast for capital expenditures for 2013 by about 13%, most of that due to higher costs, though, at a large australian natural gas field. second of all, it was raised to a buy from hold at dahlman and credit suisse moved 135 from

135. >> thanks so much. bob mentioned back in bear market territory, shares rebounding today after dropping more than 6% yesterday, the worst day in about four years. eric jackson is a long time apple shareholder, stubbornly sticking with his 1650 price target by the end of 2015. eric, i mean, you're not getting tired? you're still sticking with it? >> well let's be honest, the end of 2015 is an eternity from here and most people are making trading decisions based on where is this thing going to trade this afternoon, not at the end of 2015 so even though i'm still bullish on the company, the last few days have been really tumultuous and really difficult to watch and kind of unexpected, and i would be cautious. obviously i still own apple but if my father was coming to me and saying hey, do i put new money to work here i'd say wait a few days at least. >> you've said maybe more than any other name it seems to be vulnerable to year-end tax

concerns, two macro headlines, two technicals, even if you believe the core hasn't changed all that much, right? >> we have to distinguish between the company and what it's doing on an operational basis and the stock. we're talking about the stock, and that's important, but the company and the reason why i'm still bullish is the company i think is doing all the right things operationally and i think tim cook is just the right guy for the job. that's not how we make day-to-day trading decisions. there were a number of factors that came into play yesterday and you'd have to be a fool not to pay attention to such a big drop yesterday. it is noteworthy as you said, first time it's happened since 2008. >> in defense of the name, even as it was climbing into the low 700s, it was still inexpensive. do you believe it is inexpensive at 549? >> i think so at 549, i mean, but you know as i think we've talked about before, this is a

stock that is prone to huge run-ups and then sometimes big drops like we're experiencing. i mean what i also would point out is that there is also going to come a time where this moves upward explosively. we talked about the big drop all the way from 700 down to 505 and almost without anyone noticing the stock jumped from 505 to 590, just the intraday move is astonishing. it's hard to predict what will happen in the next couple of weeks. next week is a busy trading week so there's a possibility this gets whip-sawed around again. going into the holidays when the volume is lightened up i expect people to pile back into the stock going into january earnings. >> of course tim cook is on a bit of a pr offensive on the cover of magazines, on with brian williams tonight on nbc. one thing he has not been

pressed on at this point is cash and the management of cash and i just wonder, is there any inkling of dissatisfaction on your part, given that within a couple of years, i mean, their cash position could be half of their market cap. >> not from me personally. i wasn't even in favor of seeing them start the dividend, but i think there are a lot of investors who like the dividend and certainly i think part of the reason in yesterday's debacle was this worry that a special dividend isn't coming before the end of the year, and so that's a real issue, and i can't predict into what their supply chain needs are going to be, what potential acquisition targets might be so i think they've done just fine on their own making those kinds of decisions but tim cook has shown that he doesn't have a deaf ear to these issues and i think he will do the right thing. >> eric, we will continue to revisit it, people can't get enough talking about it, that's for sure, probably because they

own it and they're concerned where it's going. thanks a lot, eric jackson. tune in to nbc's "rock center" with brian williams for his exclusive interview with apple's ceo tim cook. when we come back people are going where the jobs are this holiday season with their rvs in tow. jane wells is in nevada. good morning. >> reporter: hey, carl, not sure we have a lot of apple shareholders here but i'll check. you want a job? find the work, up next we hit the open road visiting rv parks filled with seasonal workers working at places like amazon, called work campers. meet one, after the break. [ male announcer ] what can you experience in a seat?

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how happy are they jimmy? happier than antelope with night-vision goggles. nice! get happy. get geico. fifteen minutes could save you fifteen percent or more. coming up on "halftime" the strategist on the verge of nailing his end of year number, tom lee on where stocks go from here. apple rebounds after its sharp drop. we'll speak to the man who may have triggered the sell-off. netflix, we'll debate it, carl, at the top of the hour. >> see you in a few moments. it is a holiday season ritual, amazon.com hiring thousands of temporary workers to staff the distribution centers. as a result one town is filling up with new amazon employees and their rvs, we're talking about nevada where jane wells is this morning. good morning. >> reporter: take a look at this place, this is the fernley rv park and 60% of the people

staying here are temporary workers at amazon at their fulfillment center in the small town of 19,000 east of reno. amazon hired 50,000 such workers across the country. we were at the shift change, basically working 12-hour shifts until december 23rd. workers say about 400 seasonals have been hired here in fernley. what do you do for fun in fernley? >> sleep. >> this is sharon schofield's second year as part of amazon's camper force. she loves it, loves the lifestyle, the people. amazon is paying her rent to park her winnebago. she and her husband use the money to fuel the rv all year. i ask what is the best and worst part of work camping. >> the best thing, coming in, knowing that there's a light at the end of the tunnel, that i'm here just for a short time. the worst thing about it is, it is physically demanding, when i

come home at night, my hands are sore, my arms, legs are sore, and i'm exhausted. >> it's necessary for parks like this to survive, this particular park is not a destination park. the influx of folks that come through here seasonally is valuable to a park like us and others. >> reporter: that's bernard roberts who runs the river's edge rv park. there are 31 parks and the work campers make a big difference in nevada which has had a tough time in the economy. what do they make? about 12 bucks an hour plus overtime which they spend at the local casinos, some of it. back to you. >> jane, that is such a great story. you talk about the mobility of the modern workforce, the seasonal, the way amazon changed seasonal employment. i thought i could hear a dog in the background and not sure the dog liked either you or the cameraman. >> reporter: no, the dog liked

me fine. it was leah, a miniature pincher. she had a problem with phil sims and i have a problem with him as well but he does a great job making me look well, right, love you. >> thank you, jane wells. when we come back the ceo of a company that enables you to get your kicks shopping for the holidays. we'll find out when "squawk on the street" comes back. [ male announcer ] when this hotel added aflac

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♪ as if shopping wasn't rewarding enough, now there's shopkick, just download the free app and do what you love doing, at stores like target, macy's, best buy and more, users automatically wrack up points called freekicks, so shop around

and treat yourself. >> the ceo of shopkick joins us from san francisco. good morning. >> good morning, how are you? >> great. interesting concept, a lot of shoppers are familiar with points and cashing in points to get goods, when you buy something, but in this case you're really given credit for walking in the door. how does it work? >> all you got to do is take your smartphone out and walk into the store with your iphone or your android phone and just for being in the store, it already welcomes you and gives you points called kicks, just when you walk through the door of the store it says, hello, cyriac, how are you today? here are your kicks. >> you don't have to scan an sku to prove you were in the building. it knows. >> we deployed special technology inside the store that emits a signal and your smartphone's microphone picks it up and tells the phone oh,

cyriac is now in the store and we'll reward you just for being here. >> 4.5 million users, i think 1.5 million stores, walking into stores in the last month i guess trips that is and the partners talking target, macy's, best buy, american eagle, crate & barrel, what can they find out from you in terms of the level of engagement between you and the user? >> well, one of the things that they really care about is preparing consumers better for their trips to the store. so in the old days you used to get what was called sunday circular or your newspaper, right? remember those days. so a lot of people don't have newspapers anymore nowadays and how do you actually prepare them for the trip to the store and so what the stores really love is the idea of consumers preparing for their trip, looking at what is hot at the store, what are the latest offers, what are the new things that have just come in, and with the shop kick app you can do that, sit on your

couch and prepare your trip, liking the things you find, for example, let's say you find a pair of sneakers that you love, we will show you the same pair of sneakers when you walk through the too and get you kicks. oh, remember the sneakers you liked a couple of days ago on your couch you should check them out while you're here. >> you say every walk-in is a revenue event but you're not profitable yet. how do you get there? >> it's just a matter of getting more consumers and more retailers on board. we're already doing revenue and every person who walks in and earns their kicks is good for shopkick as well so it's a win/win/win, the retailer gets consumers in the store, the consumers get products and you're holding a bottle of tide from procter & gamble and scan the bar code and get more shopkicks. >> a 27-year-old mom with one child heavy shopper, and usually older than 18.

how much more likely is the user to end up buying something if they're already on shopkick? >> we know that whenever somebody joins shopkick, they're much more likely to buy. the retailers call that increme incrementality, they're incremental sales and we've been able to prove consumers who use shopkick will end up buying more and substantially more. it can be somewhere around 20%, 30%, 40%, the american eagle executive vice president was recently quoted in the press saying shopkick users buy twice as much as non-shopkick users. >> changing the face of retail, cyriac we'll keep an eye on you. >> thank you and go get your kicks. >> let's keep those tweets coming in an interview with brian williams which airs tonight on "rock center" the head of apple, tim cook says when i go into my living room and turn on the tv i feel like i've gone backward in time 20 or 30 years. he then adds "it's an area of

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